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Population Projections 2018-2051 Kaipara District Council October 2020
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  • Population Projections

    2018-2051 Kaipara District Council

    October 2020

  • Authorship

    This report has been prepared by Nick Brunsdon

    Email:

    [email protected]

    All work and services rendered are at the request of, and for the purposes of the client only. Neither

    Infometrics nor any of its employees accepts any responsibility on any grounds whatsoever,

    including negligence, to any other person or organisation. While every effort is made by Infometrics

    to ensure that the information, opinions, and forecasts are accurate and reliable, Infometrics shall

    not be liable for any adverse consequences of the client’s decisions made in reliance of any report

    provided by Infometrics, nor shall Infometrics be held to have given or implied any warranty as to

    whether any report provided by Infometrics will assist in the performance of the client’s functions.

  • Kaipara Population Projections – October 2020

    3

    Table of Contents

    Executive summary ........................................................................ 4

    Introduction ......................................................................................5

    Our Approach ..................................................................................6

    Employment ................................................................................................................................. 6

    Migration .......................................................................................................................................7

    Existing Population ..................................................................................................................... 8

    Households ................................................................................................................................... 8

    Findings .............................................................................................9

    Employment ................................................................................................................................. 9

    Population .................................................................................................................................... 9

    Sub-District Population ............................................................................................................. 10

    Components of population change ...................................................................................... 11

    Age Structure .............................................................................................................................. 12

    Households .................................................................................................................................. 13

    Sub-District Households ........................................................................................................... 14

    Appendix – Detailed Methodology .......................................... 16

    Employment ................................................................................................................................ 16

    Migration ..................................................................................................................................... 17

    Labour Market Shortfalls .......................................................................................................... 18

    Population ................................................................................................................................... 19

    Population Base ............................................................................................................................ 19

    Fertility ............................................................................................................................................. 19

    Mortality .......................................................................................................................................... 19

    Sub-district distribution ............................................................................................................ 19

    Households ................................................................................................................................. 20

    Living Arrangement Types ....................................................................................................... 20

  • Kaipara Population Projections – October 2020

    4

    Executive summary

    Infometrics was commissioned to produce projections of resident population and

    household numbers for the Kaipara District. These projections cover the period 2018 to

    2051 for a single medium-high growth scenario.

    The population and household projections are driven by the demographic processes of

    ageing, births, deaths and net migration. Infometrics’ projections of net migration into

    Kaipara district are informed by forecasts of employment in the district – this means that

    the final population projections are driven by economic as well as demographic factors.

    The population of Kaipara District has grown strongly over the past 15 years, and growth

    has been particularly strong in the past five years, reaching a population of 24,100 in

    2019. As a consequence of COVID-19, population growth is projected to slow over 2020

    and 2021 with softer international net migration and a decline in employment.

    Population growth is projected to pick up from 2022 onwards, with the district growing

    steadily to reach a population of 32,600 in 2051.

    Kaipara District’s population is projected to age rapidly over the next 30 years, with the

    number of residents aged 65 years and over growing from 5,600 in 2019 to 12,200 in

    2051. The population 15 to 64 years of age is projected to grow slightly, and the

    population under the of 15 is projected remain steady. The ageing population of the

    district, combined with trends of greater life expectancy and smaller families, means that

    the average household size of the district is projected to ease from 2.37 to 2.14 over the

    projection period. The effect of this is to spread the same population over a greater

    number of households. Accordingly, household numbers are projected to grow faster

    than the population, from 10,000 in 2019 to 14,600 in 2051.

    Historically, the majority of Kaipara’s population and household growth has taken place

    in the Mangawhai area. This pattern is expected to continue in future, particularly as

    further improvements to State Highway One reduce travel times into Auckland, thus

    improving the attractiveness of Mangawhai for commuting workers. The population in

    Kaiwaka and Maungaturoto is expected to grow strongly as these towns are expected to

    gain from reduced travel times into Auckland, as well as local employment growth. The

    Dargaville area is projected to grow steadily, with lesser growth in the Kaipara Coastal

    area. Population in Ruawai-Matakohe, Otamatea and Maungaru areas is expected to

    ease slightly, however the number of households is still expected to increase in these

    areas due to decreasing household sizes.

  • Kaipara Population Projections – October 2020

    5

    Introduction

    Infometrics has been commissioned by Kaipara District Council (KDC) to produce

    projections of resident population by age, and households to support their long-term

    planning. At the request of KDC, these projections are for a single medium-high growth

    scenario. These projections cover the period 2018 to 2051, and provide a breakdown of

    population and households at a sub-district level. Sub-district analysis uses Statistical

    Area 2 (SA2) areas – these are defined by Stats NZ and break the district into ten areas.

    This report contains a summary of high-level findings regarding projected population

    and household growth in Kaipara District. It is accompanied by a pivot table spreadsheet

    which provides significant detail, and which allows for a high level of flexibility in the

    analysis of these projections.

    The projections of population growth in the Kaipara District form the cornerstone of this

    report. The derivation of these population projections, as well as the projections of

    household numbers, are driven by the demographic processes of ageing, births, deaths

    and net migration. Furthermore, projections of net migration are partially driven by

    projected employment growth. This means that the final population projections are

    driven to a significant extent by economic as well as demographic factors.

    The report also includes an Appendix describing in detail the methodology employed in

    producing these projections.

  • Kaipara Population Projections – October 2020

    6

    Our Approach

    This section describes in broad terms the approach adopted in the production of these

    projections. It is intended for a non-technical audience. The Appendix contains a

    detailed description of the methodology and is intended primarily for a technical

    audience.

    Infometrics takes a unique approach to projecting population, by firstly projecting

    employment growth, which in turn informs projected volumes of net migration.

    Consequently, these population projections are essentially informed by the economic

    prospects of the district.

    Having derived these employment and net migration projections, a conventional cohort

    component approach is employed to project population and household numbers. This

    process is summarised in Figure 1 below.

    Figure 1

    The distribution of population and households within the district was informed by

    discussions with council staff, council consultants, analysis of the district’s spatial plans

    and significant private plan changes.

    Employment

    Employment is forecast by using a combination of two approaches across the short and

    long term.

    Short term employment forecasts are derived for a five-year time horizon and are driven

    by an econometric model which uses a mix of top-down and bottom-up approaches.

    This recognises that individual industries and regions will need to compete with each

    other in the future, to secure labour and skills from a workforce that is forecast to grow

    at a diminishing rate.

  • Kaipara Population Projections – October 2020

    7

    Employment growth in export-focused industries is projected by making use of a

    national model, which reflects the broad economic conditions within New Zealand.

    Service and construction industries are projected based on recent local economic and

    population trends.

    Long term employment forecasts, covering a 30-year time horizon, require a different

    approach – one based far more on structural changes to the economy, driven by factors

    such as technological change (including automation), industry productivity,

    demographics, evolving demand for different products and services, New Zealand’s

    international competitiveness, and climate change mitigation actions. This involves

    projecting changes to a range of variables, including amongst others, macroeconomic

    factors such as national interest rates and environmental factors such as carbon prices.

    The long-term employment forecasts applied in the Infometrics Population Projection

    Model draw heavily on the ESSAM (Energy Substitution, Social Accounting Matrix)

    general equilibrium model of the New Zealand economy, developed by Infometrics’

    Chief Economist Dr. Adolf Stroombergen.

    Migration

    Long-term international net migration to New Zealand is forecast by considering a wide

    range of factors affecting the New Zealand and global economies.

    In the near term, COVID-19 is the most significant influence on international net

    migration. We expect that heavily reduced international flight schedules, restrictions on

    international movements, and a general reluctance to migrate will drive net migration to

    negligible levels for 2020 and 2021. As global travel slowly resumes and the New

    Zealand economy recovers, net migration is expected to slowly return to our long term

    forecast level of 30,000 people per annum from 2025 onwards.

    While recent historic inward net migration levels in excess of 60,000 people per annum

    are unlikely to be sustained in the long term, given projections of steady employment

    growth and an ageing population, we expect sustained positive net migration well into

    the future, particularly with the aid of favourable work visa conditions.

    Chart 1

    -20,000

    -10,000

    0

    10,000

    20,000

    30,000

    40,000

    50,000

    60,000

    70,000

    02 06 10 14 18 22 26 30 34 38 42 46 50

    An

    nu

    al n

    et

    mig

    rati

    on

    Year

    International net migrationInfometrics forecast

    Historic

    Medium

  • Kaipara Population Projections – October 2020

    8

    Migration is apportioned to territorial authorities using a mix of two approaches. Firstly,

    historic migration trends are applied to forecast the volume of non-employment-driven

    migration, such as people moving into the district for retirement or out of the district for

    study. Secondly, forecast labour market shortfalls are used to forecast the volume of

    employment-driven migration, such as people moving to take up employment

    opportunities. Employment-driven migration is also adjusted slightly to account for

    commuting patterns between districts – for example, strong commuting patterns from

    the Mangawhai and other Southern settlements into Auckland, aiding by ongoing

    improvements in the State Highway One. For both employment-driven and non-

    employment-driven migration, StatsNZ’s projected age and sex profile of migrants to a

    particular district is assumed.

    Existing Population

    At present, the starting point for the population projection is the StatsNZ Estimated

    Resident Population (ERP) for 2018, which is based off the 2013 Census. Using this data,

    the Model projects the existing population using a conventional cohort component

    method. Under this approach, the starting population is grouped into cohorts consisting

    of five-year age groups distinguished by gender. The model draws on StatsNZ’s analysis

    of historic and anticipated trends in births and deaths in each age and gender group, to

    inform changes to each throughout the projection period.

    Birth and death rates are driven by a combination of factors – primarily the age structure

    of the population, and age-specific birth and death rates. Projected age-specific birth

    and death rates are sourced from StatsNZ. In the case of births, StatsNZ projects a

    decline in birth rates for mothers under the age of 35, and a slight increase in birth rates

    for mothers aged 35 years and older. StatsNZ also projects a steadily declining mortality

    rate across most age groups, as life expectancy increases due to lifestyle changes and

    advances in medical care.

    Households

    Projections regarding household numbers also follow a cohort component approach,

    involving the analysis of living arrangements for each age and gender cohort, and

    converting these figures into household numbers. This approach makes use of projected

    living arrangement type rates (LATR), which are produced by StatsNZ based on analysis

    of historic trends. LATRs indicate the proportion of each cohort in each living

    arrangement type – for example, 22% of 20-24-year old males in 2018 lived in an ‘other

    multi-person household’ (i.e. flatting) arrangement. To derive the number of households

    in the district, the number of individuals living in each household type is divided by the

    average size of each household type.

  • Kaipara Population Projections – October 2020

    9

    Findings

    Employment

    Employment in Kaipara District grew steadily over the past decade, at nearly 2% per

    annum. Employment growth is expected to turn negative in 2020 and 2021 because of

    COVID-19 and the resultant economic shock. Strong employment growth is expected for

    the remainder of the 2020’s as the district recovers from the economic shock and returns

    to its prior growth path.

    During the 2030s, more stringent environmental regulation is expected to result in

    higher carbon prices and greater regulation related to freshwater quality. Coupled with

    greater uptake of automation technology across the economy, this is expected to reduce

    the rate of employment growth, particularly in agriculture.

    Chart 2

    Population

    The population of Kaipara District has grown strongly over the past 15 years, and growth

    has been particularly strong in the past five years as a result of strong international net

    migration and growing housing pressures in Auckland. This has seen Kaipara’s

    population grow to 24,100 in 2019.

    Population growth is expected to slow down over 2020 and 2021 as a result of COVID-

    19. From 2022 onwards, population growth is projected to resume at a steady rate,

    albeit slightly slower than what was experienced in the past five years. Kaipara’s

    population is expected to continue growing out to 2051, although the rate of growth

    gently eases over that period, to reach a population of 32,600.

    0

    2,000

    4,000

    6,000

    8,000

    10,000

    12,000

    10 14 18 22 26 30 34 38 42 46 50

    Em

    plo

    ym

    en

    t

    Year

    EmploymentKaipara District

    Infometrics forecast

    Historic

    Forecast

  • Kaipara Population Projections – October 2020

    10

    Chart 7

    Sub-District Population

    Projected population growth is distributed within Kaipara District in consideration of

    historic trends, district and spatial planning, and provision for infrastructure.

    Historically, most of Kaipara’s population growth has taken place in the Mangawhai area.

    This pattern is expected to continue in future, particularly as further improvements to

    State Highway One reduce travel times into Auckland, thus improving the attractiveness

    of Mangawhai for commuting workers. This will see the Mangawhai SA2 grow by 1,770

    people by 2051, Mangawhai Heads SA2 by 2,490, and Mangawhai Rural SA2 by 2,920. It

    should be noted that the Mangawhai Rural SA2 area is expected to include urban

    development, as it incorporates the expected urban expansion of both Mangawhai

    Village and Mangawhai Heads.

    Improved travel times into Auckland are also expected to improve the attractiveness of

    Kaiwaka and Maungaturoto. Furthermore, there are prospects for local employment

    growth in these centres which will further drive population growth. Maungaturoto’s

    population is expected to grow by 270 by 2051, and Kaiwaka by 440. These projections

    assume that there will be limited provision of water and wastewater infrastructure in

    these towns. However, if water and waste water infrastructure was developed further,

    then these two towns may grow more quickly than projected.

    The population in the Dargaville urban area is expected to continue growing steadily,

    prompted by steady employment growth in Dargaville, as well as the neighbouring rural

    area prompted by the Kaipara Kai initiative. Population growth in the Dargaville urban

    area predominantly takes place in the Dargaville SA2. However, if growth in Dargaville is

    stronger than projected, the Dargaville urban area may expand to include parts of the

    Kaipara Coastal SA2. Kaipara Coastal’s projected growth reflects the growth of

    settlements such as Baylys Beach and Te Kopuru. The population of Dargaville SA2 is

    expected to grow by 1,090 by 2051, Kaipara Coastal by 90.

    Population in Ruawai-Matakohe, Otamatea and Maungaru SA2 areas is expected to ease

    slightly by 2051. These three areas have experienced relatively weak population growth

    historically, and Ruawai-Matakohe and Otamatea contain settlements vulnerable to sea

    level rise. Despite a slight decline in population, the number of households is still

    0

    6,000

    12,000

    18,000

    24,000

    30,000

    36,000

    96 01 06 11 16 21 26 31 36 41 46 51

    Po

    pu

    lati

    on

    Year

    PopulationKaipara District

    Infometrics medium-high projection

    Projection

    Historic

  • Kaipara Population Projections – October 2020

    11

    expected to increase in these areas due to decreasing household sizes – this is discussed

    in more detail in the Households section.

    Table 1

    Components of population change

    In demographic terms, population change consists of three principal components –

    births (fertility), deaths (mortality) and net migration. The difference between births and

    deaths is generally referred to as natural increase – in other words, the ability for a

    population to grow internally or ‘naturally’. Historically, births have exceeded deaths in

    Kaipara, and this is projected to continue until 2031, beyond which deaths will exceed

    births. At this point, the district becomes reliant on migration to maintain the population

    and to grow.

    Net migration into the district has displayed a broadly upward trend over the past

    twenty years, however it is expected to fall sharply in response to COVID-19. Net

    migration is expected to recover to a relatively high level by 2022, although this is still

    below recent peaks. Net migration is then projected to ease and settle at just above 300

    people per year for the remainder of the projection.

    Sub-District Population

    Infometrics medium-high projection

    Statistical Area 2 2019 2051

    Change 2019-

    2051

    Dargaville 5,077 6,169 1,092

    Kaipara Coastal 3,776 3,862 86

    Maungaru 1,865 1,607 -258

    Ruawai-Matakohe 2,520 2,418 -102

    Otamatea 1,785 1,541 -244

    Maungaturoto 1,318 1,582 265

    Kaiwaka 2,217 2,654 438

    Mangawhai 1,060 2,828 1,768

    Mangawhai Heads 2,184 4,675 2,490

    Mangawhai Rural 2,298 5,215 2,917

    Total 24,100 32,552 8,452

  • Kaipara Population Projections – October 2020

    12

    Chart 11

    Age Structure

    As is the case for the most areas in New Zealand, the population of Kaipara is projected

    to age significantly over the next 30 years. The number of youth (aged below 15 years),

    is projected to remain steady at around 4,600 people. Similarly, the population 15 to 64

    years of age is only expected to grow slightly, from 13,900 in 2019 to 15,700 in 2051.

    The 65 years and older age group is the fastest growing age group, expanding from

    5,600 in 2019 to 12,200 in 2051. The majority of this growth takes place in the next ten

    years as the relatively large ‘baby boomer’ cohort moves into the 65 years and older age

    group.

    Chart 15

    -600

    -300

    0

    300

    600

    97 02 07 12 17 22 27 32 37 42 47

    Peo

    ple

    per

    year

    Year

    Components of population changeKaipara District

    Infometrics medium-high projection

    Births

    Deaths

    Net migration

    0

    5,000

    10,000

    15,000

    20,000

    25,000

    30,000

    35,000

    13 18 23 28 33 38 43 48

    Po

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    on

    Year

    Population age structureKaipara District

    Infometrics medium-high projection

    65+ years

    15-64 years

    0-14 years

  • Kaipara Population Projections – October 2020

    13

    Households

    A combination of factors is projected to drive down the average size of households in

    Kaipara. These factors include amongst others the changing age composition of the

    district’s population, increasing life expectancy and societal trends.

    • An ageing population leads to growth in households of couples without

    children or persons living alone (such as widows / widowers).

    • Increasing life expectancy means that individuals are likely to spend longer

    periods in these household types.

    • Societal trends include couples having fewer children (i.e. smaller families),

    increasing numbers of childless couples, and delayed childbearing.

    The combination of these trends implies that Kaipara’s average household size will

    decrease from an estimated 2.37 individuals per household in 2019 to 2.14 individuals

    per household in 2051.

    Chart 19

    The combined effect of a growing population and decreasing average household size is

    strong growth in the number of households. The number of households in the district is

    projected to grow from 10,000 in 2019 to 14,600 in 2051.

    2.0

    2.1

    2.2

    2.3

    2.4

    2.5

    2.6

    13 18 23 28 33 38 43 48

    Avera

    ge h

    ou

    seh

    old

    siz

    e

    Year

    Average household sizeKaipara District

    Infometrics medium-high projection

  • Kaipara Population Projections – October 2020

    14

    Chart 3

    Sub-District Households

    In line with the districtwide household projections, household growth at a sub-district

    level is stronger than population growth, as decreasing average household sizes mean

    that more houses are required to house the same population. This means that in

    Ruawai-Matakohe, Otamatea and Maungaru, despite a decrease in population, the

    number of households is still projected to grow slightly.

    Dargaville SA2 is projected to experience steady growth of 530 households. Kaipara

    Coastal SA2 is projected to grow by 180 households.

    Households in Mangawhai are expected to grow strongly, by 840 in Mangawhai SA2,

    1,090 in Mangawhai Heads SA2, and 1,290 in Mangawhai Rural SA2. Households in

    Maungaturoto and Kaiwaka are expected to grow by 270 and 330 respectively.

    0

    3,000

    6,000

    9,000

    12,000

    15,000

    18,000

    13 18 23 28 33 38 43 48

    Ho

    use

    ho

    lds

    Year

    Number of householdsKaipara District

    Infometrics medium-high projection

  • Kaipara Population Projections – October 2020

    15

    Table 2

    Sub-District Households

    Infometrics medium-high projection

    Statistical Area 2 2019 2051

    Change 2019-

    2051

    Dargaville 2,056 2,584 528

    Kaipara Coastal 1,530 1,710 181

    Maungaru 748 771 24

    Ruawai-Matakohe 1,049 1,121 72

    Otamatea 732 750 18

    Maungaturoto 502 771 269

    Kaiwaka 875 1,203 329

    Mangawhai 472 1,310 838

    Mangawhai Heads 1,000 2,091 1,090

    Mangawhai Rural 999 2,291 1,292

    Total 9,962 14,602 4,640

  • Kaipara Population Projections – October 2020

    16

    Appendix – Detailed Methodology

    This Appendix describes in detail the methodology employed in the projections. It is

    intended for use by client representatives possessing a relatively high degree of

    technical expertise in economic, statistical and demographic analysis.

    Employment

    Short-Term Projections (Five-Year Time Horizon)

    As an initial step, Infometrics develops forecasts of employment at a national level,

    broken down by 54 industry classifications. Using econometric techniques, we develop

    approximately 50 separate statistical models for forecasting employment in each

    industry. These models draw on historic trends, patterns and relationships, and project

    these into the future.

    Using machine learning, the models are ranked according to their track record of

    forecasting future employment in a particular industry, with the forecasting ability of

    each model measured against historical data. As an example, data from 2000 to 2016 is

    applied within each model to forecast employment to 2019, with these forecasts then

    being compared to actual historical data from the period 2017 to 2019. The model

    delivering the most accurate forecast is then applied to deliver a final forecast for each

    industry for a five-year time horizon. These industry forecasts are adjusted to ensure

    consistency with Infometrics’ views of total employment growth over the forecast

    period.

    As a second step, Infometrics develops industry forecasts by territorial authority and

    region which are consistent with our national forecasts. We use a similar technique to

    that described above, developing approximately 50 forecasting models for each

    combination of 485 ANZSIC industry codes and 66 territorial authorities. Slightly

    different techniques are used for the various industries in the regions, so as to account

    for different industry drivers.

    The future performance of the agriculture, forestry, fishing, mining and manufacturing

    sectors are influenced predominately by macroeconomic conditions, which are not

    specific to local regions or districts. For example, strong demand from China for forestry

    products is highly likely to benefit the forestry sector in all regions of New Zealand. As a

    result, the models we develop for these industries are driven by nationwide industry

    trends, and the extent to which these trends historically deviate from the national

    average. Using machine learning, we are able to select the model that most effectively

    tracks and predicts these components.

    The regional forecasts for service industries (including trade, accommodation, education,

    health and professional services) are weighted more heavily towards local drivers

    including population growth, local economic conditions and visitor numbers.

    Regional forecasts for the construction sector incorporate Infometrics’ forecasts of

    construction work-put-in-place, drawn from Infometrics’ Regional Construction Outlook.

    They also consider population growth as a driver for construction activity.

    Once we have generated forecasts for each industry / territorial authority combination,

    we ensure they are mathematically consistent with our national level industry forecasts.

  • Kaipara Population Projections – October 2020

    17

    Long-Term Projections (Thirty-Year Time Horizon)

    The methodology applied the short-term forecasts described above, draws heavily on a

    statistical approach to forecasting – focusing on historic trends, patterns and

    relationships and extending these into the future. This statistical approach however

    becomes less accurate with longer forecast horizons. Consequently, longer term

    employment projections rely on the ESSAM (Energy Substitution, Social Accounting

    Matrix) general equilibrium model of the New Zealand economy, developed by

    Infometrics’ Chief Economist Dr. Adolf Stroombergen.

    The ESSAM model considers the principal interdependencies of industries within the

    national economy, including flows of goods from one industry to another, the transfer of

    costs in one industry into cost and therefore prices in other industries. The model

    presents a scenario of the New Zealand economy for selected target years (generally

    2030 and 2050), based on robust assumptions regarding various economic factors,

    including international commodity prices, population growth, carbon prices, technology

    adoption, levels of automation, changes in energy efficiency, and substitution between

    four energy sources (coal, oil, gas and electricity). The ESSAM model’s estimates of

    employment by industry in 2030 and 2050 provide a benchmark for the long-term

    employment projections included in the Infometrics Population Projection Model.

    Some of the key macro-economic assumptions used by the ESSAM model are as follows:

    Table 3. ESSAM macro-economic assumptions and outputs

    Indicator 2025-2030 2030-2050

    Population 1.0%pa 1.0% pa

    Labour force 0.7%pa 0.46%pa

    GDP 2.9%pa 1.7%pa*

    World trade 2.7%pa 2.5%pa

    Oil price US$110/bbl in 2030 US$110/bbl in 2050

    Carbon price NZ$100/tonne CO2 in 2030

    NZ$200/tonne CO2 in 2050

    Government consumption 2.1%pa 1.7% pa

    Investment in dwellings 2.0%pa 1.0%pa

    Public investment 3.0%pa 2.5%

    * These are model results, not input assumptions.

    Migration

    The population projections draw on Infometrics’ short- and long-term international

    migration forecasts.

    In the short term, COVID-19 is the most significant influence on international net

    migration. We expect that heavily reduced international flight schedules, restrictions on

    international movements, and a general reluctance to migrate will drive net migration to

    around zero for 2020 and 2021. As global travel slowly resumes and the New Zealand

    economy recovers, net migration is expected to slowly return to our long-term forecast

    level of 30,000 people per annum from 2025 onwards.

  • Kaipara Population Projections – October 2020

    18

    Our long-term forecast considers a wide range of factors affecting both the global and

    the New Zealand economy. While recent historic inward net migration levels in excess of

    60,000 individuals per annum are unlikely to be sustained in the long term, given

    projections of steady employment growth projected and an ageing population, we

    expect sustained positive net migration over the long term, particularly with the aid of

    favourable work visa conditions.

    Migration is apportioned to territorial authorities using a mix of two approaches. Firstly,

    historic migration trends are applied to forecast the volume of non-employment-driven

    migration, such as people moving at retirement. Secondly, forecast labour market

    shortfalls are used to forecast the volume of employment-driven migration, such as

    people moving to take up employment opportunities. Employment-driven migration is

    also adjusted somewhat to account for commuting patterns between districts. For both

    employment-driven and non-employment-driven migration, StatsNZ’s projected age

    and gender profile of migrants to the district is assumed.

    Labour Market Shortfalls

    Labour market shortfalls exist when employers’ requirement for labour exceeds the

    number of workers available at current wage rates. When labour market shortfalls exist

    in an area, additional labour, and hence population, is attracted to that area.

    Infometrics estimates future labour market shortfalls by separately considering the

    projected supply of labour and the projected demand for labour (as measured by

    employment) and comparing these two factors.

    As the starting point for estimating labour supply, Infometrics makes use of StatsNZ’s

    published population projections by 5-year age group and gender.

    Labour force participation rates (LFPRs) by age and gender are projected based on

    StatsNZ’s national labour force projections. In addition, historic LFPRs for each region

    are analysed to identify their deviation from the national average. This deviation is

    applied to the national LFPR by age, to project regional LFPR by age. Historic averages

    for the unemployment rate in each region are analysed and projected forward. Projected

    LFPR by age is applied to the StatsNZ population projection, and the projected

    unemployment rate is applied to this, in order to estimate labour supply.

    This projection is undertaken for each region or territorial authority, enabling the

    balance between labour supply and demand (as measured by employment) to be

    assessed within each labour market area. In periods of insufficient labour supply within a

    territorial authority or broader regional labour market to meet projected labour demand,

    the area is projected to receive additional migration.

    This additional migration is apportioned to regions or territorial authorities based on

    their respective share of the national labour market shortfall. At the same time, however,

    additional migration may be constrained by the Infometrics’ international net migration

    forecast, meaning that a particular region may not necessarily receive sufficient inward

    migration to entirely eliminate its labour market shortfall.

    Similarly, the projected LFPR and unemployment rates are applied to the additional

    migration, reflecting the fact that it is rarely possible to import only workers – instead

    these workers often come with family members, who may not necessarily be

    economically active. Examples in this regard might include stay-at-home parents,

    children and aged dependents. Furthermore, in some instances, migrants may not

    immediately gain employment following their move.

  • Kaipara Population Projections – October 2020

    19

    Population

    Population Base

    As a rule, the appropriate population to use for Council Long Term Planning (LTP)

    purposes is the estimated resident population (ERP). This represents all individuals who

    permanently reside in an area and could be considered a ‘maximum’ population, as a

    percentage of these individual is likely to be away at any given point in time.

    Consequently, the StatsNZ 2018 Estimated Resident Population (ERP) is considered as

    the basis for the population projections. This estimate is produced by StatsNZ with the

    most recent available Census (2013) data, and births, deaths and migration that has

    been recorded since. An ERP based on the 2018 Census is expected to be released

    during the course of 2020; following which this will form the basis of the projections.

    Given that the majority of population projection parameters from StatsNZ are published

    for five-year intervals, our projection model also operates at five-year intervals, from

    2018 to 2053. We then make use of a cubic-spine statistical process to interpolate

    population to single years. Once available, we will also incorporate the StatsNZ 2019 ERP

    into this process, to produce realistic projections incorporating the most recently

    available data.

    Fertility

    StatsNZ publishes regional age-specific fertility rates, for five-year age groups. This

    includes an open-bounded 45+ age group. We have however chosen to apply this only

    to the 45-49 year age group. This ensures that a growing population beyond the age of

    fertility does not artificially inflate the projection of births. The impact of this change is

    considered negligible, particularly given that between 2012 and 2014, there occurred an

    average of only eight births per annum to women aged 49 and over across New

    Zealand. Similarly, we ignore births to mothers under the age of 15, due to a lack of

    reliable data regarding fertility rates in this age group. Again, this is not statistically

    significant, as nationwide there were an average of only 21 births per annum recorded

    to mothers under the age of 15 between 2012 and 2014.

    Throughout the projection period, we adopt StatsNZ’s assumed gender ratio of 105.5

    males per 100 females born – this is based on the historic average ratio at a national

    level. This phenomenon is commonly observed around the world, and is understood to

    be a function of slightly higher miscarriage rates for female children, rather than of

    selective abortion.

    Mortality

    Projected age- and gender-specific mortality rates by region or territorial authority, as

    calculated by StatsNZ, are applied to accurately project the number of deaths.

    Sub-district distribution

    Population distribution within a region or territorial authority is projected by considering

    historic settlement patterns and expectations of future residential development activity.

    Projections are produced for StatsNZ’s Statistical Area 2 (SA2) areas. SA2 areas vary

    widely in geographic size, but are defined by StatsNZ to have similar populations – 1,000

    to 3,000 residents.

  • Kaipara Population Projections – October 2020

    20

    Values for population and households at a SA2 level are projected using a full cohort

    component approach. Net migration is apportioned to each SA2 in consideration of:

    - Historic trends in net migration for each SA2

    - Capacity for growth as indicated by KDC’s Spatial Plans and significant private

    plan changes.

    - Feedback from KDC’s officers and consultants

    Households

    Living Arrangement Types

    The number of households at SA2 or district level is projected by applying Living

    Arrangement Type Rates (LATR) to the projected population. At present, StatsNZ

    projects LATR to 2038 from the 2013 Census figures across two scenarios – A and B.

    Scenario A assumes that LATR remain constant into the future at 2013 rates, while

    Scenario B projects a linear change to 2038, based on observed historic trends and

    future expectations. These trends include delayed childbearing (discussed under Fertility

    above), decreased rates of single parenting, and improvements in life expectancy which

    enable older individuals to live independently for longer periods1. We follow the StatsNZ

    recommendation to use Scenario B for projection purposes, as this is considered more

    realistic. This means that the LATR used in the projections transitions up to 2038, and

    then remain constant at 2038 rates up to 2053.

    Applying LATR to the population provides an estimate of the number of people in each

    living arrangement type; this is then translated this into the number of households

    based on expected family structures – for example, couple households consisting of two

    individuals. For other multi-person households, we follow the standard StatsNZ

    assumptions, and assumes 2.6 persons per household. Projected population figures are

    accordingly divided by the number of households to project average household size.

    As a rule, the projected household size calculated in these projections varies somewhat

    from the 2018 Census measures. This variance can arise for several reasons:

    1) Census counts are randomly rounded to the nearest multiple of 3, or supressed

    entirely, so as to ensure confidentiality of Census respondents. Census outputs

    such as average household size are however based on actual data, meaning that

    it is impossible for third parties to precisely replicate these outputs.

    2) LATR projections are developed at a national level, representing an average

    across New Zealand. As a result, local patterns will differ – this can for example

    be driven by differences in ethnic makeup, with some non-European ethnic

    groups exhibiting a greater propensity to form multi-generational households,

    leading to larger household sizes.

    3) Household sizes are susceptible to change in the short term in response to non-

    demographic factors such as increasing housing costs.

    1 Full discussion available here

    http://archive.stats.govt.nz/browse_for_stats/population/estimates_and_projections/NationalFamilyAndHouseholdProj

    ections_HOTP2013base/Data%20Quality.aspx#Livingarrangementtyperates

    http://archive.stats.govt.nz/browse_for_stats/population/estimates_and_projections/NationalFamilyAndHouseholdProjections_HOTP2013base/Data%20Quality.aspx#Livingarrangementtyperateshttp://archive.stats.govt.nz/browse_for_stats/population/estimates_and_projections/NationalFamilyAndHouseholdProjections_HOTP2013base/Data%20Quality.aspx#Livingarrangementtyperates

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